CX Daily: China's Joblessness is on the Rise

Faster spending on infrastructure and real estate may have bolstered investment at the start of this year, but overall economic conditions in China remain unpromising, economists say.

Excluding investment by rural households, China’s fixed-asset investment — a key driver of domestic demand that includes infrastructure — grew 6.1% YOY in the first two months of 2019, edging up from a 5.9% rise in the whole year of 2018, according to official data released Thursday. The reading met the median forecast from a Bloomberg News survey of economists.

Government-driven infrastructure investment rose 4.3% YOY in the first two months, up from a 3.8% growth rate for 2018. Expansions in spending on roads and railways accelerated to double-digit rates during the period.

FINANCE & ECONOMICS

Jobs /

China's unemployment rate rose in February

China's surveyed urban unemployment rate in February rose to 5.3% from January's 5.1%, just shy of the year's official projection of "around 5.5%," according to the National Bureau of Statistics.

Despite a general sentiment of a gloomy employment outlook, the bureau said that the overall labor situation has “stabilized." In China’s 31 major cities, the number was 5.0% last month, 0.3 percentage points higher than in December.

Multinationals have started moving their production to the Southeast Asian country amid U.S.-China trade tensions, including investors from the U.S., South Korea and Japan, according to Nguyen Mai, chairman of Vietnam's Association of Foreign Invested Enterprises.

“Of course we welcome that,” he told us. “But we hope that foreign investors choose Vietnam not only to avoid the risks of trade war.”

Markets /

Regulatory official warns brokerages on type of loan that once sank the stock market

Such loans allow an investor to borrow money to amplify the size of a stock investment. The borrowings can be multiple times the amount the investor initially has to invest, leveraging the investor's potential gains and losses. The effects can impact the entire stock market.

Coming up /

Saturday, March 23: The 20th China Development Forum will be held in Beijing and will look at development, economy, policy, culture, society and ecology. Caixin is an official media partner of this forum.

Shen Changyu, director of the state intellectual property office, speaks to the media in the Great Hall of the People in Beijing on March 12. Photo: VCG

In-depth /

As China sculpts new patent law, divisions persist

China’s legislature is expected to consider a draft of revisions to the country’s patent law in the next six months, according to people familiar with the matter. But divisions persist over its potential chilling effect on innovation and the impact of giving enforcement powers to patent administrators, as well as beefed-up penalties.

There is a general consensus that the update should strengthen patent protection, but legal experts say excessive involvement of administrative law enforcement in private patent disputes would lead to imbalanced competition in the market. Meanwhile, some charge that proposed increases to penalties for patent infringement are exorbitant.

Check out our deep-dive into the law's decades-long evolution and headwinds.

E-commerce /

Nasdaq-listed Pinduoduo posts $1.5 billion loss

Online group discounter Pinduoduo Inc.’s losses widened last year as the e-commerce site burned cash on an advertising and promotion campaign to continue its fast pace of growth.

Net losses reached 10.3 billion yuan ($1.5 billion) in 2018, compared with 498.7 million yuan the year before, according to the annual report released Wednesday. Revenue jumped 652% YOY to 13.1 billion yuan.

Social commentary /

TV show goes viral portraying Chinese families as ‘businesses’

A TV series has triggered heated debate in China, portraying the “true” driving force behind Chinese families: to raise children as products to satisfy parents' needs, and to conduct familial relations like "business deals.”

In “All is Well," the mother raises her two sons as assets that serve emotional needs she failed to receive in her childhood. Two psychologists writing on WeChat argue that many Chinese families are in such an abnormal state with parents raising children to satisfy their own needs in exchange for love and attention.

Forerunners /

Dangdang founder reveals mistakes that held back e-commerce pioneer

While those outside China may not be familiar with Dangdang Inc., the company used to be a household name. One of the country’s earliest e-commerce players, Dangdang’s origins stretch back to 1999 when it started as an online bookseller, just like Amazon Inc. In its heyday around 2010, it even floated on the New York Stock Exchange.

But China’s e-commerce landscape has changed in leaps and bounds over the past 20 years. Fierce competition, failings in decision-making and a conservative approach to expansion led Dangdang to give way to rivals Alibaba Group Holding Ltd. and JD.com, Inc., observers argue. The company grabbed the media spotlight in February, when the husband-and-wife founders officially ended their business relationship. We spoke with one of the founders, Yu Yu, about the company's ups, downs and future.